I rise to present the Budget Estimates for
the year 2001-2002 for the Indian Railways. At the outset, I would like to sincerely thank
our Honble Prime Minister Shri Atal Bihari Vajpayeeji for his valued guidance
in discharge of my ministerial responsibilities. I could count on his advice and
encouraging direction whenever I approached him with any issue relating to Indian
Railways. It is my proud privilege to present the second Railway Budget of the millenium
and I would like to sincerely thank you, Mr. Speaker, Sir, and through you, all the
Honble Members of this august House for enabling me to do this.

Sir, last sixteen months has been a period of intense
experiences for me. During this period, I have seen Indian Railways from close quarters. I
have seen millions of Railway family members, working round the clock, to run more than
13500 trains across 7000 stations everyday, cutting across almost all the States. I have
seen Railways spontaneously rushing into the interiors of Orissa, Bengal and Gujarat with
a helping hand when unfortunate natural calamities struck them. I have also seen Railways
ferrying water and fodder to the drought hit states to save precious lives. Posterity will
not forget the sight of hundreds of trains trailing into Allahabad, day after day,
carrying millions of countrymen on the occasion of Mahakumbh. Sir, when our jawans and
tanks are moving to the border areas and when foodgrains from Punjab and Haryana are going
on our trains into the interiors of far flung states, I feel proud to be associated with
Indian Railways as one of its family members. A railway compartment in our country
represents, perhaps, the best example of a secular, united India, bringing about
emotional, regional, cultural, linguistic and economic integration of our diverse society.
With these experiences, Sir, I have developed a firm belief that just as water and air are
crucial for existence of a human life, Railways are equally essential, for the life of the
nation. This organisation, being the largest Railway system in the world under a single
management, has enormous strength and potential.

Sir, amongst the transport systems world-wide, Rail mode is
re-establishing itself. This resurgence is because Railways are six times greater energy
efficient, and four times higher land use efficient mode of transport. Railways are,
perhaps, the most environment friendly transport system, the world has ever known. With
its huge network spanning over 63,000 route kilometers, Indian Railways are, in fact,
engine of growth for the national economy. It is difficult to perceive growth of Indian
economy without a corresponding growth in Railway infrastructure.

But, Sir, sadly, Indian Railways with all its inherent
strengths and potentials has not received the attention it deserves from the nation. With
the increase in population, expectations of the countrymen from this system, and the
social responsibilities reposed on it, are continuously on the rise. On the contrary, the
investments in this system have been almost continuously declining over the years. The
capital support from the General Exchequer which reached a peak of 75% in the Fifth Five
Year Plan, fell to 42% in the Seventh Five Year Plan and skidded to a low level of 18% in
the last two years of the Eighth Plan. To fill-in the gaps, Railways have been forced to
resort to larger market borrowings with attendant huge burden of interest liability. This
has inflicted long term damage to the otherwise healthy Railway finances. As a
consequence, railways share in freight movement has also dropped from 89% in 1950-51 to
about 40% as of now.

Sir, Indian Railways are at cross roads today. We are
facing the dilemma of realising our true identity, our objectives and goals. On the one
hand, we have the social responsibility of being an affordable carrier of people and
goods. On the other hand, we are often expected to play the role of a profitable
commercial enterprise and, thus, fend for ourselves. I learn from many economists and
experts that the answer lies in treating ourselves as cost centres and
profit centres. Sir, the countrymen know that Railways have grown as a
people-centric, society-centric public utility. Sir, let us pause
here for a moment and do some soul-searching. Are we a commercial enterprise only? Or are
we a public utility? Or should we continue to play a combined role in the larger interest
of the public good? Sir, Indian Railways are not merely a transportation utility. They are
a dependable friend of the Indian people. And just as a friend in need is a friend indeed,
the Railways have stood by our people in good as well as bad times.

Sir, Railway experts and economists have been criticising
Railways for starting large number of projects with low or negative rate of return. Sir, I
am neither an expert nor an economist. But as one of the common man in this country, I
feel that Railways existence is necessary to pave the way for development. Emphasising
only high economic rate of return, will discourage any developmental initiative in far
flung areas. Can we afford to do it, Sir ? I expect that my Honble colleagues will
guide me in searching for an answer to this question.

Sir, there are large number of challenges which Railways
face today. The dual roles of Railways as public utility and a commercial undertaking are
at times conflicting while the sources for funding these two diverse activities are the
same. Railways also do not receive compensation for social service obligations.
Technological modernisation of Railways is critically required, but low investment over
the last two decades has almost stopped this process. Unfortunately, the support from
General Exchequer also has been taking a downward trend right from fifth Plan till Eighth
Plan, dropping from 75% to 18%. This is pushing railways on to borrowings at high rate of
interest causing permanent damage to its finances. Internal resources of railways have
also suffered a severe and permanent jolt immediately after implementation of Fifth Pay
Commission recommendations. Railways have 16 lakh employees which is 40% of the entire
central government strength. In the coming year, pension alone is likely to cost Rs. 5,800
cr which Railways have to bear themselves. Otherwise, Pension liabilities of other
Government employees are borne by General Exchequer.

Sir, during my tenure, I have initiated several measures to
meet these challenges within our limited means. For the first time, Railways seriously
started pursuing the non-traditional sources of revenue generation. However, developing
new sources, which are non-traditional, and tapping them takes time. I had also launched a
serious economy and austerity drive. Sir, the House is aware that this drive had yielded a
saving of Rs. 850 cr during previous year. For the current year also, the target in this
regard is Rs. 865 cr. However, Sir, these measures are not adequate to meet the severest
challenges. Some more steps are needed which I would like to outline below:-

For financing socially relevant projects and for running
train operations to meet socially desirable ends, outright grants without dividend
liability should be provided by the State. On the other hand, a special fund with a mix of
seed contribution, borrowings and private sector participation should be created for
funding remunerative and operationally required projects.

Railways need to develop market oriented and customer
friendly outlook due to emerging competition within the transport sector.

Sir, the House is aware that much discussed recommendations
of Railway Safety Review Committee chaired by Justice Khanna have evoked large support
from Honble Members. But Railways are still awaiting the recommended one time grant
for safety purposes.

There is urgent need to prioritize railway projects for
speedy implementation. Cost-sharing of such prioritized projects with the State
Governments, which has recently begun, should be further intensified. Sir, I would like to
thank the State Governments of Andhra Pradesh, Tamil Nadu, Maharashtra and Karnataka who
have already come forward in this direction. I wish other State Governments will also join
these efforts.

Railways have an enormous hidden wealth in the form of
land, airspace etc. which needs to be unlocked to augment its resource base. Several
non-traditional means of mobilising resources have been introduced recently. But this
process needs to be taken forward in all seriousness.

Sir, these steps, I feel, will bring about major
improvements in the Railway finances. I am happy to inform the House that this aspect is
now being professionally looked into by an Advisory Committee under the Chairmanship of
Shri Sam Pitroda.

Brief review of financial performance during 1999-2000

Sir, Honble Members are aware that the year 1999-2000
was an extremely difficult year, as the Railways had to face the impact of recession on
earnings coupled with soaring increase in the working expenses as a result of
implementation of the Fifth Central Pay Commission. But, Sir, we have together fought this
adverse situation with all the courage at our disposal.

I am happy to inform the House that due to concerted hard
work of railway family members, we achieved an all-time record of incremental freight
loading of 35 million tonnes, surpassing the target of 450 million tonnes by 6.42 million
tonnes in the year 1999-2000. This was, indeed, a remarkable achievement despite the
background of severe setback in the year before that. Even the passenger earnings
registered an impressive growth of 12%, and surpassed the budgeted target by Rs. 132 cr.

As a post budgetary development, Railways finances came
under stress due to upward revision of price of diesel oil as well as levy of an
additional cess and revision of tariff by some of the State Electricity Boards. This
coupled with damage caused to Railway property by Orissa cyclones put an additional burden
of around Rs 900 cr on the system. Sir, we consciously chose not to shift this burden on
to rail users. I am happy that we were able to absorb the entire burden ourselves.

Despite all these difficulties, gross earnings increased
from Rs 33,021 cr in Revised Estimates to Rs. 33,125 cr in the actuals. Total Working
Expenses which stood at Rs 30,909 cr in the Revised Estimates were also contained at Rs
30,844 cr. Pensionary liabilities, budgeted at Rs. 4,094 cr in the Revised Estimates
finally came down to Rs. 4,022 cr. The plan expenditure stood at Rs. 9,057 cr as against
Rs. 8,965 cr in the Revised Estimates. The market borrowings however, were reduced from Rs
3,000 cr in the Revised Estimates to Rs 2,919 cr.

Review of financial performance during the
current year

Sir, the House will recall that a target of 475 million
tonnes was fixed for loading of revenue earning freight traffic for the year 2000-01.
Indian Railways have already loaded about 390 million tonnes of revenue earning freight
traffic during the period from April, 2000 to January, 2001 which is 18.48 million tonnes
more than the loading achieved in the corresponding period of last year. Keeping the trend
in view, the freight-loading target of 475 million tonnes would definitely be achieved. In
the current year, positive growth has been witnessed in loading of coal, iron ore for
export, POL, iron and steel, cement and other goods.

I am happy to inform the House that there has been a
historically high growth in passenger earnings, which reached about Rs 8,552 cr by end of
January 2001. This marks an increase of Rs 740 cr over previous years earnings
during the corresponding period. Other Coaching and Sundry earnings also have been quite
encouraging compared to previous years performance.

Non-traditional sources of earnings

Sir, the House would recall that the Railways had, for the
first time, set for themselves the task of mobilising the resources from non-traditional
sources such as leasing of right of way for laying Optic Fibre Cables,
commercial utilisation of land and air space and commercial publicity on rolling stock and
station buildings. A target of Rs 750 cr was kept for 2000-01.

I am happy to inform the House that RailTel Corporation of
India has already started functioning to build a nation-wide broad band and multimedia
network by laying Optical Fibre Cable along 62,800 route kms of railway track by utilising
Railways right of way. The business plan of this Corporation as
developed by professional consultants is now awaiting final approval of the Government.
The Corporation will soon start its core activities after the business plan is finally
approved by the Government. In the circumstances, although we had projected an income of
Rs 500 cr from this Corporation in the current year, it is now expected that significant
revenue flows will commence only during 2001-02. In view of the positive response and
encouraging offers already received by RailTel Corporation both from within the country
and outside, Railways propose to initiate other such ventures. For example, a separate IT
company is contemplated to avail of the opportunities offered by e-commerce.

Commercial utilisation of Railway land / airspace has been
identified as one of the valuable non-tariff options for raising additional resources. In
my last budget speech, I had set a target of Rs. 150 cr to be realised through railway
land. I am happy to inform the House that 53 sites identified for this purpose are being
developed through RITES and IRCON, which have been appointed as nodal agencies for
executing these schemes. A sum of Rs. 81 cr has already been realised by end of December
2000 on this account. We hope to achieve our target by the end of the financial year.

A sum exceeding Rs. 30 cr has been generated by way of
commercial publicity and advertisements on stations and rolling stocks. This innovative
measure was introduced for the first time by way of a non-traditional means of raising
resources. Although the target of Rs. 100 cr for the year may not be achieved, the
breakthrough made in the very first year has inspired us to exploit this resource more and
more with the help of professionals. In the next year, empowered groups both at national
and zonal levels will enhance these activities taking professional help. A comprehensive
and transparent policy package would be drawn up within a period of three months.

Safety

Sir, I fully share the concern of the House and the public
about critical need for improvements on safety front.

The House is already aware that Justice Khanna Committee
had concluded that for rehabilitation of railway assets for safety, there was a need for a
grant of Rs. 15,000 cr to be made available to Railways over a period of 5 to 7 years. As
resources of this magnitude cannot be expected to be internally generated by the Railways,
I was very much hopeful that a way would be found to meet this recommendation of the
Committee. This has, however, not materialised. Sir, on this issue, I am sorry, my speech
would be silver but my silence would be golden.

Sir, I would like to assure the House that within our
limited means, Railways are committed to accord highest priority to safety. Despite the
financial constraints being faced by the Indian Railways, we are trying to ensure that the
level of outlay on safety related works is maintained. Track renewal works must receive
priority. I, therefore, propose to enhance the outlay for this crucial activity taking it
to Rs 2,050 cr, marking an increase of almost 26% over the revised outlay for the current
year. Induction of modern technology into our signalling and telecommunication system is
equally important. This has the added benefit of progressively reducing dependence on
human intervention, thus leading, to an improved safety environment. That is why, Sir, I
have decided to enhance the outlay on signalling and telecom in the next financial year by
as much as 25% over the revised outlay in the current financial year. Sir, with these
enhanced outlays, I am happy to inform the House that we are, indeed, making provision of
amount exceeding Rs. 3,000 cr on safety heads. However, this allocation will only help us
meet the current arisings and not the arrears for which additional funds would be
required.

Sir, in order to ensure that safety requirements are
strictly followed at all levels, I have already made the Chairman, Railway Board in charge
of safety on Indian railways. This would facilitate better co-ordination on all safety
related activities at the highest official level.

Security

Sir, the general perception is that the Railways are
responsible for providing security to passengers and their belongings. But the fact
remains that policing on the Railways is the responsibility of the State Governments.
Unfortunately, the law and order situation in certain States has not been conducive to
smooth working of rail operations.

Railways have now commenced a process of streamlining the
functioning of RPF to make it more effective. The measures taken include modernisation of
communications, security gadgets and weaponry, provision of adequate transportation,
computerisation, upgrading of training facilities etc.

Sir, the House is aware that I had setup a High Level Task
Force on security on Indian Railways. The Task Force has recently submitted their report,
which is under examination. Sir, the solution lies in either the State Governments
becoming proactive in improving policing on railway systems. Alternatively, Sir, I seek
the guidance of this House on how to grant more powers within the framework of the
Constitution to RPF to provide adequate security cover to rail users.

FREIGHT : New Initiatives

Sir, freight revenue constitutes two-thirds of our total
revenues. In order to regain the freight market share which Railways have lost in recent
decades and to take it to the level of 50% in the current decade, I propose to initiate
various measures in the next year. Some of the major steps proposed to be taken are :-

A comprehensive delegation of powers to the Zonal and
Divisional Railways has been undertaken in order to sharpen our interface with the
customers. General Managers have been authorised to devise appropriate marketing
strategies at local level to capture additional freight traffic.

A Congested Route Development Charge for those
routes on Indian Railways which have become heavily saturated is being introduced to
enable Indian Railways to plan traffic facility works to remove the bottlenecks.

Volume Discount Scheme is being continued for the third
consecutive year.

Special lumpsum rates for movement in Merry-Go-Round (MGR)
circuits over short stretches have been developed for attracting bulk movement of coal and
minerals at pit-head Power Houses/Mines. This package will target short-lead bulk traffic
for rail movement.

Roll-on-Roll-off (RORO) packages which had been
experimented on the Konkan Railway are now being extended to Ahmedabad-Nabha and
Chennai-Sankrail (Kolkata) circuits.

Surplus railway land at stations and more than 1,500
unutilised Goods Sheds at roadside stations are being offered for development of
warehousing capacity and, thereby generate additional traffic on the railways on the one
hand and supplement revenues on the other.

We want to modernise our freight operations by using the
state of the art technology for real time monitoring. In this direction, project for
computerised monitoring of Freight Operations (FOIS) is expected to cover the entire
network of Indian Railways by June 2001.

Passenger Amenities

I plan to give a major thrust to improvement in the
passenger amenities at the Stations. I am happy to announce that the outlay for Passenger
Amenities will be further increased by 39% over the revised estimate to cover many new
areas of improvement. Following steps are being initiated for this purpose:-

Ticket refunds are being fully computerised on all zonal
Railways.

Automatic Teller Machines (ATMs) are being installed at
various important stations and will be later used for issue of tickets also.

For providing quicker information to public, on-line train
running position will be available through Cable TV / Internet and on Cellular Phones by
connecting National Train Enquiry System to these systems.

To reduce congestion on ticket counters, proposal to use
internet kiosks for ticket retailing is under consideration.

Computerised information on reservation availability status
and train movement status will be available on all A class stations.

In our Customer Care Institute, various training programmes
have been initiated to train the front-line staff for better customer service.

Top priority would be accorded to provision of drinking
water, platform shelters, increasing the length of the platform to accommodate longest
train, raising the platform heights and ensure adequate seating arrangements.

To improve sanitation at stations, a large number of
Pay and Use toilets will be provided and mechanised cleaning will be
undertaken.

We have undertaken a large-scale exercise in modernisation
of customer service by bringing up more and more stations as model stations. 210 stations
have already been selected. I now propose to develop another 74 stations as model stations
in the next year.

Sir, as a major step to provide access to computerised
reservation facility, I have decided to include another 71 locations throughout the
country within the ambit of computerised Passenger Reservation System (PRS). Honble
Members are aware that PRS facility is already available at 670 locations in the country.

In order to improve the quality of service in long distance
trains and to provide better amenities to the travelling public, certain amenities on the
lines of Rajdhani Express trains have been introduced on 30 trains.

Catering Services

Railways have formulated a New Catering Policy with a view
to introducing a transparent system of award of licences through competitive bidding in
case of major catering units. The policy also provides for 25% reservation at the
discretion of the General Managers, to the various disadvantaged categories in the
allotment of catering licences of small catering units.

Indian Railways have initiated a number of steps to expand
the scope of catering services both at stations and in trains.

Health

Sir, I am happy to announce that to facilitate prompt
medical attention to the needy passengers, a computerised database containing the
locations and details of non-railway medical facilities along the railway tracks
throughout the country have already been compiled. This information is available on
Railnet.

In pursuance of my budget speech of 2000-01, first aid
boxes with wider range of medicines were provided in model stations and long distance
trains. The training of front line staff is continuing.

It is proposed to expand the facilities and modernise the
Railway Hospitals to provide cost effective high quality care to the Railway employees in
Jagjivan Ram Hospital, Mumbai, Divisional Hospital, Jhansi, Railway Hospital, Perambur and
Dr.Babasaheb Ambedkar Hospital, Mumbai.

In order to provide better indoor medical facilities to the
Metro Railway employees at Kolkata, one 30-bedded hospital is proposed to be set up at
their Tollygunge outdoor clinic.

Tourism

Sir, I have given special attention to promote rail
tourism. In my Budget speech last year, I had announced that a new "Palace on
Wheels" type of train would be introduced between Maharashtra and Goa touching
several places of tourist interest, as a joint effort between the Railways and the
Government of Maharashtra. I am happy to inform the House that a Memorandum of
Understanding has been signed between the Railways and the Government of Maharashtra
recently. All other arrangements to ensure the introduction of the train will be firmed up
shortly.

I am also happy to announce that another proposal to run a
tourist train for the pilgrimage tourism on Secunderabad-Dharmavaram
(Puttaparthy)-Tirupati-Guntur-Nadikude-Secunderabad circuit in Andhra Pradesh is being
considered. Andhra Pradesh Government has also proposed a Palace-on-Wheels type of train
for which modalities are being discussed.

Sir, I am also happy to announce that the Government of
Karnataka has proposed to jointly run a Palace-on-Wheel type of train on
Bangalore-Hospet-Hubli-Goa-Mangalore-Hassan-Mysore-Bangalore circuit. Modalities in
this regard are being worked out.

Orissa Government has sent a proposal for running a steam
safari train on a route attractive for local tourism. Modalities in this regard are being
worked out. Railways will welcome such proposals of tourism interest from any other State
Government.

The newly incorporated Indian Railway Catering and Tourism
Corporation has taken up a few important tasks, which are expected to facilitate tourism
in a big way. The "Mata Vaishno Devi" package launched in November 2000 has been
very popular with pilgrim tourists.

The Darjeeling Himalayan Railway has been recognised as a
World Heritage Site by UNESCO. This greatly adds to the commitment of the Railways to
maintain and preserve this unique piece of engineering skill for posterity. It is proposed
to revamp and upgrade the infrastructure. We plan to run specially designed tourist
packages in this area under the aegis of Indian Railway Catering and Tourism Corporation.

Preserving Railways history through the institutions
of regional rail museums has been an important activity of Railways. Rail Museum for
southern region is going to be completed shortly. Similarly, I am happy to announce that
new Regional Rail Museums will be set up at Varanasi and at Malda on the eastern region.

Relief Measures

Sir, this year the country has witnessed a large number of
natural calamities. Apart from the most recent and most devastating of them all i.e.
earthquake in Gujarat, there have been floods in State of West Bengal, cyclonic rains in
Andhra Pradesh and drought in Gujarat. As always, Railways have provided all possible
assistance including free movement of fodder and water to various states in order to
mitigate the sufferings. Railways have moved more than 300 rakes of fodder and around
20,000 wagons of water to the drought affected areas of Gujarat, Rajasthan and Orissa,
free of charge.

As part of relief and rescue operations in Gujarat after
the recent earthquake, 49 special trains were run to reach relief material and relatives
to Gujarat and for evacuating the injured. Railways were the first to reach the interiors
with a helping hand.

I am happy to inform the House that on behalf of the
Railway family, a sum of Rs 15 cr has been contributed to the Prime Ministers
National Relief Fund for the victims of recent earthquake. Apart from this, various public
sector undertakings of Railways have additionally contributed more than Rs. 3.58 cr.

Konkan Railway Corporation

Sir, I am glad to inform the House that the Konkan Railway
Corporation has improved its operations and this year its earnings have increased by 30%
over the previous year. However, the earnings of the Corporation are just sufficient to
meet its operating expenses. I would like to reassure the House that the Ministry will
continue to help the Corporation not only in meeting with its debt servicing obligations
but also to increase its revenue generation and realise its full potential.

Metropolitan Transport Projects

I am happy to inform the House that doubling of
Belapur-Panvel line has been commissioned for commuter traffic from April 2000. Fifth line
between Santacruz and Andheri as part of 5th line project between Santacruz and
Borivali has also been commissioned. Work on balance portion between Andheri and Borivali
is also progressing well and is expected to be completed within the next financial year.
Work on automatic signaling system between Virar-Dahanu Road is also likely to be
completed within this financial year thereby increasing the line capacity on this section.
New line of Thane-Turbhe-Nerul/Vashi which will provide another commuter corridor in New
Mumbai is also expected to be completed by March 2002 if the land acquisition in
Thane area is expedited by the state government. Projects of quadrupling of Borivali-Virar
section and construction of 5th and 6th lines between Kurla and
Thane are also progressing well.

Works on the projects for extension of Kolkata Metro
Railway from Tollygunge to Garia, extension of Circular Railway from Princepghat to
Majerhat and provision of connection with Circular Railway from Dum Dum to the airport as
well as electrification of the existing Circular Railway from Tala to Princepghat are
continuing. Dum Dum-Tala section on Circular Railway has already been electrified.
Electrification of Ranaghat-Gede has also been completed and Ranaghat-Bongaon will be
completed within this financial year. This will facilitate running of EMU services in
these sections also. Electrification of Barasat-Hasanabad is also progressing
satisfactorily.

I am further happy to announce that as an extension of
Calcutta Circular Railway Project, a link is proposed to be established between Ultadanga
and Rajarhat (Phase-I up to Lake Town) to connect Dum Dum Airport to Titagarh in the North
and Dum Dum Airport to Garia in the south.

Honble Members will be happy to know that the work of
Phase II of Mass Rapid Transit System in Chennai from Tirumalai to Velacheri is
progressing at a good pace. To ensure its timely completion requisite funds are being
provided in the year 2001-02. Work on gauge conversion of Chennai
Beach-Tambaram-Chengalpattu suburban section has also picked up speed and is progressing
well.

Honble Members will be happy to know that based on
the proposal submitted by Government of Andhra Pradesh, a Memorandum of Understanding has
been signed between the Government of Andhra Pradesh and Indian Railways for strengthening
the existing suburban infrastructure and services in the city of Hyderabad and its suburbs
for making certain sections in the city fit for commuter train operation.

I am happy to inform the House that Rail Coach Factory
(RCF), Kapurthala also bagged the prestigious "Golden Peacock Environment
Management" Award in June 2000. 27 Coaches of the state-of-the-art LHB design, are
slated for indigenous production during 2001-02. RCF has bagged orders for export of 72 MG
bogies to Vietnam National Railways. Diesel Locomotive Works (DLW), Varanasi have bagged
order for 12 BG Diesel Locomotives from Bangladesh Railways and Sri Lanka Railways during
the current year.

Sir, I am glad to inform the House that Chittaranjan
Locomotive Works (CLW) has manufactured a new WAP  7 locomotive named
Navbharati, which can be used to haul 26 coach trains at a speed of 140 KM per
hour. CLW is now attracting a large number of International enquiries. Delegations from
Switzerland, Turkey and South Africa have visited CLW to explore the possibility of buying
locomotives based on latest technology.

RDSO

The functioning of the Research Designs & Standards
Organisation (RDSO) is the pioneering R&D wing of the Indian Railways has been
thoroughly reviewed in the current year in pursuance of my budget commitment. Several
steps are being initiated to improve the performance of this organisation.

PUBLIC SECTOR UNDERTAKINGS

Hon'ble Members will be happy to know that the performance
of the Public Sector Undertakings has been satisfactory during the year 1999-2000. In
1999-2000, IRCON International Ltd. had a turnover of Rs 538 cr and earned a net
profit of Rs 47 cr. It paid a dividend of Rs 11.38 cr. Rail India Technical and
Economic Services (RITES) achieved the highest ever turnover of Rs 172 cr during the
year 1999-2000, recording a net profit of Rs 16 cr and paid a dividend of Rs 3.20 cr. Container
Corporation of India Ltd. (CONCOR) had a turnover of Rs 832 cr, earning a profit of Rs
178 cr and paid Rs 36 cr as dividend. Indian Railway Finance Corporation earned a
net profit of Rs 301 cr. It mobilised a total of Rs 2,836 cr. from market in 1999-2000 to
supplement the plan resources of Indian Railways. It paid a dividend of Rs 65 cr.

ANNUAL PLAN 2001-02

Sir, when I sat down to compile budget estimates for
2001-02, I was certain that there will be some growth in the Budgetary Support from the
General Exchequer. I was also hopeful that to tide over the safety related requirements, a
separate grant would be available. However, none of these materialised. But, Sir, I am
happy to announce that even with all these constraints, we have been able to keep the Plan
outlay for 2001-02 at Rs. 11,090 cr, which is 11% higher than the revised estimates of the
current year. Capital support from the General Exchequer continues to be Rs. 3,540 cr, as
in the current year. It is proposed to go in for market borrowings to the extent of Rs.
4,000 cr. The balance of Rs. 3,550 cr is being met through a combination of conventional
sources and non-traditional sources of revenue. We are also relying on clearance of a
portion of the Railways dues from powerhouses. Traffic outstandings, a large part of
which is powerhouse dues have touched a new height of Rs. 3,027 cr as on 31st
December, 2000. The target set for clearance in the coming year is Rs 750 cr. As part of
this, we expect that outstanding dues of at least Rs. 500 cr from Badarpur Thermal Power
Station would be realised by us in the next year, as promised by the then Power Minister
last year.

Sir, in the current year, we had received a budgetary
support of Rs. 3,540 cr which was about Rs. 1,000 cr higher than the year 1999-2000.
Simultaneously, Government had also agreed for a dividend deferment of Rs. 1,500 cr, so
that our net payout of dividend was reduced to only Rs. 615 cr. Next year, Sir, there has
been no growth of Budgetary Support while the Railways will also have to pay Rs 1,352 cr
to the General Exchequer by way of dividend, as the dividend deferral permitted is reduced
to Rs 1,000 cr only.

Sir, while safety continues to be our core focus in Annual
Plan 2001-02, I have also decided to give major thrust to completion of new line projects
which are pending for long time. Safety is being further strengthened with the allocation
for Track Renewals being enhanced from Rs. 1,633 cr in the Revised Estimates to Rs. 2,050
cr, marking an increase of 26%. In our continuing drive to improve user services,
allocation for Passenger Amenities is going up to Rs. 200 cr marking an increase of 39%
over the Revised Estimates for the current year.

Austerity is a major area engaging my concern. It would be
recollected that in the previous year, austerity and economy drive had resulted in net
saving of Rs. 850 cr. This year again, the target for savings through economy and
austerity measures has been set at Rs.865 cr. I would like to assure the House that in the
next year also, austerity and economy will receive high priority.

NEW TRAINS

Sir, throughout the year, I have been receiving volumes of
requests from the people at large and also from Honble Members of Parliament who
represent them, on starting new trains and increasing frequencies, extensions etc. Sir,
you will surely agree that it is very difficult to satisfy everybody. But I do appreciate
that in view of our increasing population, these are genuine requirements and hence the
expectations. After taking into account the demand, availability of infrastructure,
availability of adequate maintenance to ensure safety, impact on freight traffic etc., I
am happy to introduce the following new services :-

New Delhi-Raipur-Bilaspur weekly Rajdhani Express

New Delhi-Ranchi-Hatia weekly Rajdhani Express

Bi-weekly express between Gorakhpur and New Delhi.

Bangalore-Vasco Bi-weekly express.

Pune-Ernakulam weekly express via Londa and Madgaon.

Asansol-New Jalpaiguri weekly Express.

Secunderabad-Dharmavaram Express.

Sealdah-New Jalpaiguri Bi-weekly Express.

Jaipur-Ernakulam Weekly Superfast Express.

Dhanbad-Hatia Intercity Express.

Howrah-Yashwantpur (Bangalore) Bi-weekly Express.

Indore-Gandhinagar (Ahmedabad) Express.

Howrah-Trivandrum-Nagercoil Weekly express.

Kurla-Bhubaneshwar (Via Sambhalpur) Weekly Express.

Valsad-Patna Weekly Express serving Surat area.

Haldia-Asansol Express

Jodhpur-Chennai Weekly Express.

Solapur-Pune Intercity Express.

Jodhpur-Hardwar Link Express

Palghat-Trivandrum Express.

Bhubaneshwar-Palasa Intercity Service

Asansol-Jhajha-Amritsar weekly Express

Weekly Rajdhani Express to Secunderabad upon completion of
New Terminal Works at Hazrat Nizamuddin.

Rampurhat-Howrah Intercity Express.

I have been receiving a large number of appeals from the
people from different parts of the country requesting for augmenting services available to
second class travelling passengers on long distance routes. Keeping these in view, I am
happy to announce that from the next year, I propose to introduce "Matribhumi"
Express trains to be run during peak rush season with only second class and second class
sleeper coaches, on the following routes :-

Delhi-Jammu

Howrah-Delhi

Howrah-Dehradun

Delhi-Barauni via Lucknow

Hyderabad-Bangaore

Mumbai-Gorakhpur

Mumbai-Varanasi

This will be my humble effort to help reduce the
difficulties faced by common passengers on long distance routes. Depending on the
utilisation of these services, their continuity will also be considered.

Increase in Frequency

Sealdah-New Delhi Rajdhani Express from 2 days to 4 days a
week.

Gorakhpur-Dehradun Express from 2 days to 3 days a week.

Rajkot-Ernakulam Express from one to 2 days and extension
upto Okha.

Jabalpur-Rajkot Express from 2 days to 4 days by extending
Rajkot-Bhopal Express to Jabalpur on 2 days.

Sealdah-Darbhanga Ganga Sagar Express from 4 days to daily.

Vishakhapatnam-Bilaspur Express from 4 days to daily and
extension upto Korba.

Secunderabad-Rajkot Express from weekly to 2 days.

Nizamuddin-Bilaspur Gondwana Express from 3 days to 5 days
by extending Nizamuddin Nagpur Express to Bilaspur.

Indore-Jaipur Express from weekly to 2 days.

Extensions

Surat-Patna Bi-weekly Express from Patna upto Bhagalpur.

Pune-Varanasi Express to Darbhanga on 1 day.

New Delhi Guwahati Rajdhani Bi-weekly express to Dibrugarh
Town from one day to two days.

Chennai-Guwahati Bi-Weekly Express to Dibrugarh Town on one
day.

Jodhpur-Jaipur Intercity Express to Sawai Madhopur

Guwahati-Lumding Express to Dimapur.

Kacheguda-Palasa Express to Bhubaneshwar.

Jodhpur-Jammu Tawi Express to Ahmedabad.

Howrah  Gorakhpur weekly Express via Barauni, Ballia
and Indara to provide a direct service between Ballia and Howrah.

Service introduced / to be introduced on
completion of Gauge Conversion / New Lines / Restoration

Upon completion of Peddapally  Karimnagar New Line,
two pairs of passenger services have just been introduced from 14th February,
2001.

Following services will be introduced on the recently
completed Gandhidham-Bhuj Gauge Conversion.

Extension of Mumbai-Gandhidham Kutch Express to Bhuj.

Extension of Bareilly  Gandhidham Bi-weekly Express
to Bhuj.

Extension of Pune-Gandhidham Weekly express to Bhuj.

Two pairs of passenger services.

On the recently restored metre-gauge line between New Mal
Junction and Changrabandha, one pair passenger service will be introduced between Siliguri
and Changrabandha via New Mal junction.

One pair of passenger service will be introduced between
Eklakhi and Gazol and extended upto Balurghat upon completion of the new line.

An express train from Howrah to Digha will be introduced on
completion of the new line. In the interim period a DMU service will be run on the 16
kilometre completed portion between Tamluk and Bajkul.

Two pairs of broad gauge service will be introduced upon
completion of gauge conversion of Pandharpur-Kurduwadi section.

MEMU / EMU Service

Kazipet-Dornakal-Vijayawada

Purulia-Adra

Bilaspur-Nagpur

Kanpur-Shikohabad

Bilaspur-Raigarh.

Bally-Bandel (2 pairs)

DMU Service

Kharagpur-Jaleshwar-Bhubaneshwar

Jalandhar-Hoshiarpur

Kotkapura-Fazilka

Samastipur-Darbhanga

NEW LINES

Sir, The House is aware that Railways have a large shelf of
new line projects costing about Rs. 20,000 cr, of Gauge Conversion projects costing about
Rs.9,100 cr, and of Doubling projects amounting to Rs 3,300 cr which have been duly
sanctioned by the Parliament over last five decades and are awaiting completion. After
having seen the implementation for last one year, I have reached the conclusion that
adding new projects to already sanctioned large shelf of on-going projects will only
aggravate the problem. Therefore, I have taken this bold decision of not including any new
line project in the next years budget. I am afraid this may disappoint many of my
Honble colleagues here. But, Sir, in the long-term interests of Indian Railways I
feel that this has become inescapable.

I further propose that ways and means must be found to
expeditiously complete the on-going projects. Sir, that is why, I have decided to increase
the investment in new line projects in the next year by as much as 45% in comparison to
the revised estimates of the current year. This increase, amounting to Rs.312 cr, will not
only facilitate general speeding up of new line implementation, but will also result in
completion of the long-pending projects.

On-going new lines, which have either been completed
recently or would be completed before March 2001 are:

Puttaparthi-Penukonda section of Dharmavaram-Penukonda
project

Kashinagar-Kakdweep section of Lakshmikantapur-Namkhana
project

Kapadvanj-Modasa project.

Eklakhi-Gazol section of Eklakhi-Balurghat project.

Jaruri-Banspani section of Daitari-Banspani project.

Bargachia-Munshirhat section of Howrah-Amta project

Tamluk-Bajkul section of Tamluk-Digha line

The new lines targeted to be completed in 2001-02 are:

Gazol Buniadpur of Eklakhi-Balurghat project

Dharmavaram-Penukonda, completing the Dharmavaram-Penukonda
project.

Dewas-Maksi new line section.

Bajkul to Digha of Tamluk-Digha project.

GAUGE CONVERSION

The sections of which gauge conversion has either been
completed or would be completed before March, 2001 are:

Nonera-Seoni section of Guna-Etawah project

Raxaul-Birganj section

Gandhidham-Bhuj section

During the year 2001-02, Railways plan to complete the
gauge conversion of the following sections:

Seoni-Bhind

Amguri-Tuli

Makum-Dangri

Laxmanthirtha bridge

Gooty-Pendakallu

Dhrangadara- Kuda

Wankaner-Morbi

DOUBLING

During the current year about 200 km of doubling would be
completed, while in the next financial year a target of 300 km has been proposed. Sir,
keeping in view the critical need to augment line capacity in certain saturated sections,
you will be happy to know that the following new doubling works are being included in the
budget.

Ernakulam-Mulanturutti section on
Ernakulam-Kottayam-Kayankulam line

Bandel-Jirat
section on Bandel-Katwa line.

Baruipur
to Magraghat

Harishchandrapur-Kumarganj
section on Malda-Kumedpur line

Gooty-Renigunta
section-Doubling of remaining single line sections

Sir, it gives me pleasure to inform the House that we have
decided to extend the following works as part of some of the on-going projects.

Extension of Sultanganj-Deogarh new line project with a new
link from Banka to Barahat .

Extension
of BDR gauge conversion project by a new link from Bowai-Chandi to Khana to connect
Midnapur, Bankura and Purulia.

Extension
of Lumding-Badarpur-Silchar gauge conversion project from Badarpur to Baraigram.

Extension
of sanctioned GC from Ajmer-Chhitaurgarh-Udaipur project to Umra.

New line
from Banka-Bhitiah Road as extension to Sultanganj-Deogarh new line project

Considering the long standing demand of the people of
Murshidabad and the need for development in this area, I am happy to announce that
restoration work of Nasipur (Azimganj)  Jiaganj Railway line will be taken up during
the year 2001-2002. Separately a survey work for construction of a bridge over Bhagirathi
to connect these two will also be undertaken.

Restoration of Teesta Valley narrow gauge line from Sevok
to Gillikhola has been a long standing demand of the people of Sikkim and North Bengal. I
have also decided to take up the restoration of this important railway line during the
year 2001-2002.

Another significant rail link needing urgent restoration is
Mogra-Tarakeshwar line. This also has been a long standing demand of the people and
accordingly, I have decided to start the work on this restoration in 2001-2002.

Sir, it would be recollected that in the last budget I had
announced a new line project for facilitating better connectivity of North Eastern states.
This New Moinaguri-Jogighopa line will be routed through Changrabandha to facilitate
better communication links with neighbouring states.

SURVEYS

On the basis of requests received from the Honble
Members and State Governments, I have decided to take up several surveys during the next
financial year. These are:

Howrah-Sealdah
3rd line between Belangar-Bally and additional loop at Dumdum, Baranagar and
Bally

Budge
Budge to Uluberia including a rail cum road bridge.

2nd
coaching terminal at Trivandrum

Byepass at
Bandel and Naihati

Ranjitpura
to Yeshwantnagar

Development
of infrastructure in Kakinada area

Thanjavur
to Chennai Egmore via Adiyalur

Gauge Conversion Surveys

Virudnagar to Manamadurai

Doubling Surveys

Ujjain to Indore

Patratu
Chandil via Barkhakana

Gooty-Renugunta
section of remaining single line section

RAILWAY ELECTRIFICATION

In the current year, electrification of 425 route
kilometres is envisaged and the following sections are planned to be completed before
March 2001:-

Sirhind- Nangaldam-Una

Ranaghat-Gede

Ranaghat-Bongaon

Some of the important routes to be completed in the next
year are:-

East Coast line from Visakhapatnam to Kharagpur. With this,
the entire Calcutta-Chennai route will stand electrified.

Main line of Eastern Railway, (Sitarampur-Mughalsarai)
providing alternative electrified route on Asansol-Mughalsarai section.

Udhna-Jalgaon section linking two important electrified
main trunk routes of Delhi-Mumbai via. Western and Central Railways will be electrified.

Industrial Relations & Staff Amenities

Railways have a large human resource base. There is need to
further enhance their skills by using modern tools and techniques of the 21st
century along with modern management concepts. There is a need to maintain a cordial
relationship between the workers and the management in a large enterprise like Indian
Railways. Industrial Relations over Indian Railways remained peaceful and cordial during
the year. The grievance redressal machinery under PNM and JCM schemes functioned
satisfactorily at all levels.

Sir, I am happy to announce that I propose to enhance the
outlay on staff amenities by as much as 45% over the revised estimates for the current
year. Railway staff members are highly committed and hardworking and I am proud of them. I
would also take this opportunity to announce that keeping in view acute housing
difficulties being faced by our employees, a novel housing scheme called "Own Your
Own House" scheme is being devised. Detailed modalities in this regard will be worked
out soon.

Sports

Sir, I am happy to inform the House that during the year
2000-01, Indian Railway sportspersons performed creditably both at the National and the
International level. Many Railway Athletes participated in the Asian Track and Field
Athletic Meet held at Jakarta in August, 2000 and won 9 Medals including 3 Gold and 6
Silver in individual events. Apart from this, four Indian Railway athletes were members of
the Gold and one Silver Medal winning relay teams.

Sir, the Members will be happy to know that the policy for
recruitment of sportspersons has been revised and substantially liberalised to attract
more talents. I am also happy to inform the House that we have decided to form a separate
sports cadre at gazzetted level with an objective of providing further promotion to
outstanding sports persons.

Sir, I am also happy to inform the House that the
allocation for Railways Sports Promotion Board is proposed to be increased to Rs. 3 cr
which is 36% higher over the revised estimate for the current year. This will go a long
way in promoting sports activities in the Railways.

Reforms and Restructuring

Sir, If I may be permitted to use a Railway metaphor, I
would say that the Indian railways are today standing at a junction station. One track
takes them to reforms, revival and rejuvenation. The other track will lead them to a
nowhere land of crisis and chaos. Sir, we must make the right choice, sooner, rather than
later. We have already set in motion various reform measures. Efforts are underway to
generate resources through non-traditional sources. We recognise this task is not going to
be easy at all and it cannot be done overnight as well. A system which remained largely
unchanged during five decades will need some amount of time, continuity and perseverance
with the full support of not only the Central Government but the State Governments as
well. Sir, we also feel that in any reform exercise, our employees will be our strength.
We feel that no reforms can be successful without full involvement of the people. I would
like to assure this House that Railways shall not be privatised.

The House is aware that a Railways Expert Group was set up
in 1998. The Group has submitted an Interim Executive Summary of its report very recently,
which is under examination. The detailed report is awaited.

Sir, we all know that Railways urgently need modernisation.
However, we need to select appropriate technology. We also have to find innovative means
of funding this process of modernisation. I am happy to inform the House that I have set
up an Advisory Committee under the Chairmanship of Shri Sam Pitroda for suggesting ways
and means of initiating comprehensive modernisation of Indian Railways with the
application of appropriate technologies. The Committee will also suggest areas for
resource mobilisation in various facets of railway functioning.

International Co-operation

In our continuing efforts to promote international
co-operation amongst the neighbouring countries, I am happy to inform the House that the
rail link between Petrapole in India and Benapole in Bangladesh has recently been restored
and opened for goods traffic. This will pave the way for running of passenger services
also.